Monday, July 31 2017 14:26
Karine Melikyan

Total net profit of Armenian insurance companies in first half of 2017 fell by 51.6% per annum - to $ 2.6 million

Total net profit of Armenian insurance companies in first half of  2017 fell by 51.6% per annum - to $ 2.6 million

ArmInfo. The total net profit of Armenian insurance  companies in the first half of 2017 dropped 51.6% year-on-year  (against growth of 74% a year earlier) to 1.3 billion AMD or $ 2.6  million. According to the Ranking of Armenian insurance companies  prepared by NA ArmInfo, the deterioration in the annual dynamics was  caused by a sharp acceleration of the upward trend of insurance  claims from 0.7% to 30.5% with a continuing low growth rate of  insurance premiums - 4.7% against 4.2% a year earlier. In the annual  breakdown (I half-year of 2017 to the first half of the year 2016),  profit loss was observed for all six insurance companies, with RESO  being the most significant - by 2.2 times - with the departure from  plus to minus.

Only for the II quarter net profit of insurers increased by 44.6%  (against 0.5% growth a year earlier), which is due to a slowdown in  the rate of decline in premiums (from 32.6% to 22.8%) against the  backdrop of accelerating the decline in the volume of reimbursements  (from 7.1% to 10.2%). Moreover, in the quarterly analysis, two  companies managed to get out of the profit loss (growth of 2.4-3.2  times), two companies significantly increased their profit (by  61-93%), and only two companies reduced their profits (by 34-43 %).

The first place in terms of net profit for the first half-year is  held by Rosgosstrakh Armenia Insurance Company - 518.4 million AMD  (the annual decline is 56.7%). In second place is SC Nairi Insurance  with a profit of 307.4 million AMD (annual decline of 27.9%). TOP-3  is closed by IC "INGO Armenia" - 249.2 million AMD (annual decline by  52.4%). Then comes Armenia Insurance, with a profit of 230.6 million  (annual decline of 0.2%), Insurance Company Sil Insurance with a  profit of 3.5 million (annual decline of 91.6%). The list closes with  a minus indicator of IC "RESO" - 39.7 million AMD (annual decline of  2.2 times), having moved from profit to loss.

The total volume of insurance premiums for the first half of 2017,  according to the reports of the IC on IFRS standards, amounted to  16.6 billion AMD ($ 34.5 million), and insurance indemnities - 8.1  billion ($ 16.9 million). Insurance premiums totaled 7.2bln AMD for  the II quarter, and reimbursements - 3.8bln AMD. As a result, the  aggregate profit on the insurance line fell by 12.1% year-on-year to  8.4 billion ($ 17.6 million), demonstrating a more impressive decline  in the quarterly section - by 33.4% to 3.4 billion, at that time as a  year earlier increasing dynamics was in positive territory - 6.6%,  and quarterly in a more significant negative - 45.8%. The highest  profit on the insurance line was fixed in the first half of 2017 from  IC INGO Armenia - 2.4 billion (annual growth of 12.9%, quarterly  decline of 34.5%), the second position was taken by Rosgosstrakh  Armenia - (The annual decline is 22.3%, the quarterly decline is  56.7%), the third position is held by Nairi Insurance - 1.6 bln  (annual decline of 25.8%, quarter growth of 7.7%). "Sil Insurance",  "RESO" and "Armenia Insurance" continue to occupy the fourth, fifth  and sixth positions - 924.5 million, 745.8 million and 485.1 million  AMD, respectively, of which only "RESO" provided a quarterly growth  of this indicator, thereby slowing down the rate of the annual  recession, while the "Sil Insurance" and "Armenia Insurance"  quarterly decline triggered an annual decline.

To note, there are 6 companies operating in the Armenian insurance  market, out of which there are 17 insurance classes, except for  railway transport insurance and insurance of judicial and  extrajudicial expenses. For 16 classes, INGO Armenia Insurance  Company (the only one operating in the water transport insurance  category) was licensed, Rosgosstrakh Armenia Insurance Company was  licensed for 15 classes (the only one operating in the credit risk  insurance class). (The calculated exchange rate of the AMD to the USD  as of 30.06.17 was 480.47 AMD/USD1).

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